+1.60(+0.13%)

+0.02(+0.13%)

+0.00(+0.27%)

A new NFL season begins today, with a rematch of last season’s Super Bowl between the Carolina Panthers and Denver Broncos. But as the season kicks off, a different team is in the spotlight: the Oakland Raiders. An initiative is underway to move the Raiders to Las Vegas, if the NFL approves it.

The move depends on the completion of a new $1.9 billion, 65,000-seat stadium there; it would be the most expensive NFL stadium ever built. (MetLife Stadium in New Jersey cost $1.6 billion and Levi’s Stadium in Santa Clara cost $1.3 billion.) And the man behind that costly project is Las Vegas Sands (LVS) CEO Sheldon Adelson.

The 83-year-old casino mogul, who ranked No. 15 on last year’s Forbes 400 list with $30 billion in net worth, spoke exclusively to Yahoo Finance by phone to discuss his plan.

Raiders owner Mark Davis has committed to moving the team, and he has pledged $500 million to the stadium project, which includes a $200 million NFL loan and the likely sale of Raiders personal seat licenses (PSLs). Adelson will contribute $650 million of his own money to the project, and has brought on developer Majestic Realty. The final piece would be $750 million in public funding, raised by raising the hotel room tax in Clark County, Nev., by less than 1%. ($750 million from the county plus $650 million from Adelson plus $500 million from the Raiders brings the total to $1.9 billion; that price tag could still go higher.)

A rendering of the proposed Stadium from designer Manica Architecture

The project is not without controversy. The glitzy stadium plan, complete with retractable roof, looks exorbitant to critics like the local Culinary Union, which has argued that the NFL and Adelson ought to pay for it on their own. Clark County Commissioner Christina Giunchigliani (D) also opposes the stadium. “There has never been,” she said, “a public-private partnership that has built a stadium that has been a good investment for the public.”

Meanwhile, the Las Vegas Convention Center is seeking expansion, which would also require an increase in Clark County hotel room tax. Jim Murren, CEO of MGM Resorts, said in January, “We do not support room taxes being diverted to a stadium when we have this just tremendous, tremendous, dire need at our convention center… Let’s go to the must-haves before we go to the nice-to-haves.”

But in a presentation last month to the Southern Nevada Tourism Infrastructure Committee (SNTIC), Sands president Rob Goldstein, present on behalf of the Adelson family (LVS, the company, is not involved in the financing), was unyielding. He told the committee, “Not to be difficult, but we’re not negotiable. If we can’t get $750 [million], we respectfully thank you but we’re going to move on.”

And Adelson himself (it’s pronounced “ADD-elson”) is not without controversy. Last year the billionaire purchased the Las Vegas Review-Journal newspaper. He has been the subject of criticism for his takeover of the paper and his reported attempts to use the paper’s editorial staff to aid in the stadium project.

In two hours of conversation with Yahoo Finance, Adelson addressed that criticism, and answered a wide range of questions about the stadium financing, his motivation, local competition, public opinion, and the politics of NFL ownership.

What follows is a condensed transcript.

Yahoo Finance: When did you first decide you wanted to be involved with financing this stadium?

Sheldon Adelson: My company got involved through my government relations guy, Andy Abboud. He heard about this idea and talked to the people at Oakland. That’s all. So I’m not the expert on this. But that’s alright, I’ve done dozens of businesses in my life and knew nothing about each one before I started.

A stadium project is publicly scrutinized, often criticized, and costly. Why do this?

Stadiums make very little money. And sports teams don’t make a lot of money either. Stadiums are barely profitable. Now, some owners who own teams also own part or all of the stadiums. [New England Patriots owner] Robert Kraft and [Dallas Cowboys owner] Jerry Jones are the only ones I know of that seem to have made a lot of money. But it’s not a business I would get up and start doing around the country.

But sports teams do grow in value. Teams keep selling for higher and higher prices.

Right. It’s the ‘greater fool’ theory—one day you’re going to run out of fools.

So, again, why do it? Are you a big football fan?

No, I’m a minor football fan. My 17-year-old son is a fanatic about sports, particularly basketball and football. But I’m not. I know Bobby Kraft and I got interested in football. But I’m not like a real football fan. This is not something that I have to do. I’m doing it because we see there could be some advantages to the whole community—not necessarily on the NFL side, because it’s very difficult for us to make any money from the stadium just with the NFL team. The only opportunity for us to make money is from activities other than football.

We could package our rooms with prime seats in the stadium for concerts, for mixed martial arts, for boxing, for college football, for major league soccer. The last fight between Mayweather and Pacquiao could have filled a football stadium, it was in extremely high demand. And we think we could bring in Premier League soccer teams like Manchester United, Chelsea, Arsenal, Liverpool, Barcelona, Real Madrid, they could come in and do their friendlies. And that would bring crowds. It’s a tourist attraction like conventions are a tourist attraction. [Note: Adelson made his money initially in conventions; he created the computer trade show Comdex.]

And all the other hotels could do that too. They could buy tickets to the events and offer to their guests. I’m not monopolizing the tickets.

So it’s not just about getting an NFL team?

The part of the year that is slow, profit-wise, in Las Vegas, is the summer, and November to December. We have an opportunity to improve that [with the stadium]. We can fill our rooms during the slowest time of the year. Mid-November to December is the slowest part of the year, that’s why it was easy for me to run Comdex the week before Thanksgiving. In college football, that’s the busy season. So we could have a concert on a Friday night, a college game on Saturday, and an NFL game on Sunday. And nobody’s coming in for one day. So each one of those will fill up all the hotels, not just mine.

So I’m doing it as a community effort. I don’t need it. I could live without it. It doesn’t move the needle for our company or any of the four [big local casino] properties to do it, Wynn, Sands, Caesars, and MGM.

How did you get [Raiders owner] Mark Davis on board?

I’ve talked with him several times, I’ve had lunch with him. But listen, this is not something that Sheldon Adelson is selling to somebody else. It takes two to tango. [The Raiders did not respond to requests for comment; KTNV reports that Davis and Adelson met again in Las Vegas on Wednesday to go over the latest draft of the stadium proposal.]

If [Mark Davis, pictured above] wants to come to Vegas, he’s gotta get a team, he’s gotta get a stadium. He can’t build a stadium himself, otherwise he would have built it in Oakland. He needs somebody to build it and he needs somebody with a deep pocket that can guarantee it and somebody with some political influence that can arrange to get the money from the room tax. I’m one of the four big operators in town, so it’s not difficult for me. I’ve done a lot of building and I can guarantee the construction. And if the local government knows I’m behind it, they can feel comfortable because I’ve changed the town, in regards to conventions.

So it’s about past success, when you make the case to others.

But I’m not going to sell Davis; either he wants it or he doesn’t want it. The matter is very simple. I could live with any deal, I could live without any deal. A guy in my position doesn’t need anything. I’ve got everything I need, I can do anything I want. I don’t need this. If I’m going to have to go out and beg Mark Davis or somebody else to do it, I’m out. If they want to find somebody who is desperate as a football fan and wants to be a part of a football club, then they picked the wrong guy. That’s not me.

Look, I’ve built 70 million square feet. I’m one of the largest developers in the world, or at least in the United States. So I’ve done a lot of building. To build a million and a half square feet is like a rounding error for me. So it’s not a problem for me to build that much. No problem. The only other guy that has built big properties is Steve Wynn. MGM has only built CityCenter and that was a massive failure. It’s been seven years in existence and they’re just starting to get a little bit of return. Low single digits. That’s the only property they developed. Then they built some convention space in Mandalay Bay. Harrah’s has never built anything. They’ve just acquired and bought other properties. So, who’s going to build it, other than me? Wynn could build it. Others haven’t built anything.

Steve Wynn is a sort of rival of yours; have you spoken to Wynn about this, has he expressed interest in being involved?

We’re not exactly rivals in this. He has spoken to my people, he would like to be involved. But this is a personal thing and not a company thing. [A spokesperson for Wynn Las Vegas tells Yahoo Finance, “We are certainly supportive of the stadium concept; it would be a tremendous addition to Las Vegas”.]

The stadium is for the community. It’s a community effort to benefit the community. It’s going to have very little benefit for Sheldon Adelson.

But you did say it will help you rent more rooms in the off-season. That benefits you.

Every hotel will benefit. That’s why it’s a community effort.

It appears your challenge now is to get $750 million in county funding – how difficult will that be?

It hasn’t been so difficult. It’s not a one-time grant, it’s $50 million a year for 15 years that will guarantee a $750 million mortgage. [Other reports have suggested it will be less than $50 million per year, over a period closer to 30 years.] And remember, that money doesn’t go to me, it goes to a stadium authority.

The county will collect the room tax that we as hotel operators collect for them. And then they allocate the room tax. We’re only talking about $750 million. [Clark County] collects more than $300 million a year in room taxes. [In 2015 it was actually up to $606 million, according to the SNTIC.] So they’re not taking it out of taxpayers’ pockets. The local residents understand that the tourists will pay for it and they [locals] won’t even notice it.

And is that really the case? The tourists are essentially paying for it?

Yes. In other cities, the local taxpayers pay for it, because they don’t have a tourist base. But all of our hotels, for the most part, are occupied by tourists, who pay a room tax. So the local residents here won’t feel any imposition of taxes. Let’s say the room tax is 12%, maybe the tax goes up to 12.75%. But I know that it will be less than a 1% increase in room tax.

Would you consider raising your own commitment if the public funding does not come through for $750 million?

No, because the cost is too high and we won’t be able to do it without that amount. It would increase the required size of the equity investment to the point where it would be unfeasible.

The general expectation is that if this works out, and the Raiders move, you will get an ownership stake in the team. Is that likely?

I am taking the risk to guarantee the completion of the stadium. I think it’s going to significantly help the value of the team, so I’d like to get some interest in it. But if I took an option on the team, the interest size of the option would have to be approved by the NFL.

UNLV also wants the new stadium. Will you help finance a new stadium even if the Raiders don’t move to Las Vegas?

If I don’t get a professional football team I’m not going to do it. It’s going to lose money otherwise. That’s why municipalities and government have to put up the money. If you want that kind of economic development for your city, the city government has to help to finance it.

Since the NFL owners will vote on whether the Raiders can move, have you tried to talk to owners and win them over? Might they object to you being an owner because you are in the gaming industry? [The NFL declined to comment for this story; there is no explicit prohibition under NFL rules on a team moving to any particular city, but three fourths of the owners will need to approve it.]

I’ve met with Jerry Jones and I’ve talked to Bobby [Kraft]. Bob is the chairman of the committee for relocation in the NFL. He’s in favor of it. It’s an old wives’ tale that they [the NFL] say gambling is no good. I’ve read that 28 of the 32 teams have interest in fantasy sports. Well, that’s gambling. So 28 teams are involved in gambling. [28 of the 32 NFL teams have marketing deals with either DraftKings or FanDuel. For more of Adelson’s views on daily fantasy sports, see this separate interview.]

It’s an ‘old wives’ tale’ that a gambling executive can’t be an NFL owner?

No, it’s an old wives’ tale that they won’t base a football game in a city or state that has gambling, that’s the old wives’ tale. But look, the Rooney family [Pittsburgh Steelers] owns a casino in Yonkers. [Tim Rooney, son of Steelers founding owner Art Rooney, owns Empire City Casino in New York, but sold his shares in the Steelers in 2009.]

What kind of NFL owner would you be? Would you be like Steve Ballmer, going to the games, getting involved?

No, no. Listen, I bought the local newspaper. I haven’t been to the building once. I’ve owned it 10 months now and I’ve only met one editor. I haven’t interfered with the newspaper. [Many critics disagree; more on that further down.] It’s an investment. This is like that.

Would I be a football nut if I took a piece? Maybe, but unlikely. Would I go to every game? No. If I’m an owner, I’m not going to be a fanatic. But my children would be.

Many say an NFL team in Las Vegas wouldn’t have a devoted fan base. Are they wrong?

It’s very difficult to say. I think that any professional sports team that comes to Vegas will find a willing audience. The people that come to town come with their fandom. They are fans of the teams from the cities from which they come. Would they be a fan of a local team? I’ve thought about that, and I think they could be.

They may not be as enthusiastic or want to spend the same money they would on the team they’ve supported for decades, but they certainly would go to the stadium when their former hometown team comes in.

Why else would Vegas be a good place for an NFL team?

Well, there’s 2.1 million people in the Vegas valley.

It is basically a transient town, many people come here in between jobs and leave, but a lot of people do stay. I’ve been here 25 years. My home is no longer Boston. I’ve said in the past that the citizenry was too transient and they come here with loyalty to another team, but hey, they could have two loyalties.

I’ve never had such a thought. It’s not an issue. Getting this approved has nothing to do with having given money to politicians. Either it’s a good deal for the community or it’s not.

There was a report that reporters at the Las Vegas Review Journal received a memo asking them to ask local lawmakers how they would vote about the stadium; the suggestion is that you asked the editors to do this as a way for you to gauge which way votes might go. Do you have a comment on this?

The newspaper has nothing to do with the stadium. If the editor thinks it’s worthwhile, let him do stories on it, but I don’t control the editorial and I didn’t give any order about this. [Glenn Cook, managing editor of the Review-Journal, told Deadspin, “We completely deny any allegation that our reporters are collecting information for our owner.”]

Everybody thinks I’m using the newspaper to push my own personal affairs. You know, our family owns a newspaper in Israel [Israel Hayom], and everybody thinks I’m using it to push Bibi Netanyahu. We don’t push Netanyahu. Listen, the paper has been around for 75 years. We’ve got a 350,000 print run every weekday, and 550,000 on the weekends. Do you think we can fool 550,000 people to read a newspaper if they believe the newspaper supports Bibi? This is a narrative from our competitor who wants to discredit the newspaper. The Review-Journal is independent.

How will you feel if, for whatever reason, the stadium doesn’t happen?

I don’t get that passionate about items. Like I said before, I could live with it or without it. I’m not that passionate. Do you think guys like Buffett or Gates are passionate about something like this? They can buy a football team or basketball team with the stroke of a pen, and so can I. So there’s no reason to be passionate about this.

It would be a financial interest for me, that’s all, like buying the newspaper or completion of airplanes. It would be a business hobby.

—

Disclosure: The author’s father, a lawyer, does some legal work for Sheldon Adelson.

Daniel Roberts is a writer at Yahoo Finance, covering sports business and technology. Follow him on Twitter at @readDanwrite.Sportsbook is our recurring sports business video series.